With 24 percent of its overall telecommunications revenue in 2001 coming from data communications, Bahrain leads the Arab Middle East and North African (MENA) region in market maturity and development. Bahrain was followed by the United Arab Emirates (UAE), which saw 10 percent of its total telecommunications revenue generated by data communications last year.

At five percent and four percent respectively, Egypt and Tunisia fared better than Saudi Arabia, which has yet to rollout advanced managed data network services (MDNS) kingdom-wide, according to the latest report from the IDC Telecommunications Group.

IDC Senior Analyst Mohsen Malaki emphasized the importance of MDNS in the success of Batelco and Etisalat's datacoms offerings. While Bahrain's overall telecommunications market is only one-tenth the size of Saudi Arabia's, its MDNS and leased line revenue, standing at $107 million by year-end 2001, is nearly the same size as the latter country's.

"Bahrain's incumbent monopoly, Batelco, has managed to propel the growth of data communications services through the introduction of advanced MDNS such as global frame relay and ATM services," Malaki explained. Global MDNS is a major portion of Bahrain's datacoms revenue, due to the heavy presence of multinational firms in the country. "The partnership with Cable & Wireless has certainly helped in the rollout of these global managed data services," continued Malaki.

The UAE, which has a larger domestic telecoms market than Bahrain, derived 10 percent of its overall telecoms revenue from MDNS and leased line provisioning. "Much like Batelco, Etisalat has been rolling out new managed data services aggressively over the past several years," said Malaki. "In line with both operators' strategies to diversify their revenue sources away from international long distance and GSM (Global System for Mobile Communications) revenue, data communications has become an invaluable part of Batelco and Etisalat's revenue mix."

The data communications markets in both countries compare favorably with the Western European average, where roughly 11 percent of overall telecommunications revenue came from datacoms.

Perhaps the most surprising result of the comparative analysis is Saudi Arabia's position in the matrix. With a $5.2 billion telecoms market in 2001, Saudi Arabia is by far the largest telecommunications market in the region. Saudi Arabia's MDNS and leased line revenue constituted a meager two percent of the overall telecoms market, however. "Delays in the launch of managed data services have been the main reasons for the underdeveloped datacoms market," according to Malaki.

IDC's report findings indicate that most datacoms revenue in the Kingdom came from leased line provisioning in 2001. "With a national data backbone established, and the nation-wide availability of new services such as frame relay and ATM (Asynchronous Transfer Mode) in the near future, Saudi Arabia's data communications market has tremendous growth opportunities," asserts Malaki.

The Egyptian market, one of the few markets to have introduced competition in MDNS alongside Jordan and Lebanon, has seen demand for frame relay services from banks and financial institutions drive MDNS revenue far higher than leased line revenue. A similar trend is emerging in the Lebanese and Jordanian markets as well, according to the IDC report. Data communications services constitute five percent of telecoms revenue in Egypt, four percent in Tunisia and Oman, three percent in Jordan, and two percentin Lebanon. — (menareport.com)